Quarterly report pursuant to Section 13 or 15(d)

CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)

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CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED) (USD $)
3 Months Ended
Mar. 31, 2014
Mar. 31, 2013
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net income $ 1,014,092 $ 404,044
Adjustments required to reconcile net income to net cash (used in) provided by operating activities:    
Depreciation 303,754 294,762
Amortization of intangible assets 74,119 276,494
Stock based compensation 129,273 98,295
Deferred tax provision 148,919 149,625
Changes in continuing operating assets and liabilities:    
Trade receivables (2,506,270) (4,689,537)
Unbilled receivables 1,021,932 893,177
Other accounts receivable and prepaid expenses (350,142) 150,005
Inventories 1,542,427 (428,290)
Severance pay (required Israeli statutory), net 132,707 69,076
Trade payables (1,470,813) 1,150,937
Other accounts payable and accrued expenses (949,273) (616,141)
Deferred revenues (613,737) 742,458
Discontinued operations 0 (323,725)
Net cash provided by (used in) operating activities (1,523,012) (1,828,820)
CASH FLOWS FROM INVESTING ACTIVITIES:    
Decrease (increase) in restricted collateral deposits 2,251 (302,947)
Purchase of property and equipment (300,998) (900,953)
Additions to capitalized software (61,710) (3,675)
Discontinued operations 0 44,827
Net cash provided by (used in) investing activities (360,457) (1,162,748)
CASH FLOWS FROM FINANCING ACTIVITIES:    
Repayment of long term debt (19,206) (543,943)
Change in short term bank credit 2,473,403 2,203,722
Discontinued operations 0 (9,298)
Net cash provided by (used in) financing activities 2,454,197 1,650,481
INCREASE IN CASH AND CASH EQUIVALENTS 570,728 (1,341,087)
CASH ACCRETION (EROSION) DUE TO EXCHANGE RATE DIFFERENCES (15,849) 81,339
NET CHANGE IN CASH AND EQUIVALENTS – DISCONTINUED OPERATIONS 0 56,933
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD 5,821,325 1,580,627
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD 6,376,204 377,812
SUPPLEMENTARY INFORMATION ON NON-CASH TRANSACTIONS:    
Interest paid during the period 37,686 73,871
Taxes paid on income during the period $ 3,877 $ 10,500